Bill > HB1553

This bill aims to reduce school district maintenance and operations ad valorem (property) taxes by modifying how surplus state revenue is allocated. The bill changes the state compression percentage calculation for school district taxes, allowing the commissioner of education to reduce this percentage based on surplus funds deposited in the property tax relief fund. If the commissioner determines the state compression percentage can be reduced to zero, school districts would no longer be required to impose a tier one maintenance and operations tax, but would still receive full funding as if they had a maximum compressed tax rate. The bill mandates that for each state fiscal biennium, the comptroller must allocate 90 percent of general revenue that exceeds consolidated appropriation limits to the property tax relief fund, with these funds primarily designated for reducing the state compression percentage. If the deposited funds exceed the estimated school district maintenance and operations taxes, the legislature may appropriate any surplus for other purposes. The provisions of this bill would take effect beginning with the state fiscal biennium starting September 1, 2027, providing a future mechanism for potential property tax relief through strategic use of state revenue.

Budget and Finance

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=HB1553